Nov. 19, State Representative John Otto (R) of Dayton, filed House Joint Resolution 5 (HJR 5). This resolution is an amendment to the Texas Constitution which requires the Comptroller to transfer sales and use tax revenues to the State's Rainy Day Fund, when the increase in such revenues exceeds the average rate of growth for the previous 20 years. HJR 5 is the direct result of the findings of the Select Committee on Fiscal Stability, which Rep. Otto chaired during this interim.
"When sales and use tax revenues grow at higher than normal rates of increase (as they did in 2006 and 2007), we should transfer some of that revenue into savings in our Rainy Day Fund. We experienced 9% and 12% growth in sales tax revenues during those two years, when the average growth rate had been around 6.5% for the previous 20-year period. That kind of revenue growth cannot be sustained indefinitely. My amendment will smooth out revenue fluctuations and save money during the good economic times, as opposed to having that money immediately available to spend. It will assist the State to live within its means and lessen the need for future tax increases." stated Rep. Otto.
The amendment will require a 2/3 vote in both the House and the Senate in order to be placed on the ballot for the voters next year.